My finance strategy has changed over the years from when I was paying off debt, to when I was saving like a crazy person so I could leave my job, to paying off student loans after getting married, to now, back to saving again!  Throughout that time, my money mission has remained the same…  stay out of debt (or at least not add to it), spend less than I make, and to continually save for the future.  Here’s a deep dive into my strategy.

 

Short-Term Strategy:  For any short-term saving goals, I like to use simple savings accounts in online banks (I use Ally).  I save for things like travel, purchasing new tires or other car maintenance, and anything else that I want to buy in the next few months to up to 3 years.  Recently, I used these accounts to help fund our move to Asheville and to help pay for our wedding last Summer.

 

Long-Term Strategy:  I use mutual funds to save for the long run.  Long-term goals are things like retirement, extra-large purchases like houses, cars, or really-epic trips.  I have my retirement accounts at Morgan Stanley and regular investments at a combination of Morgan Stanley and Betterment.

 

Accounts I Use:

 

Business

  1. Checking- This is where all the money that I make in my business goes and where any expenses come out of.
  2. Money Market- 25% of everything I earn through my business goes in here for taxes.

 

Personal

  1. Checking- All household bills are paid out of here. This is the main money hub!
  2. Bank Savings- We keep a mini emergency fund at our main bank.  This is used for any small things that come up out of the blue that we didn’t necessarily budget for.
  3. 6-month (of Living Expenses) Emergency fund– This account is so important and acts as insurance.  This account is NEVER touched.  It is only there to be used for a LEGIT emergency… like someone is dying or we are on the verge of living on the streets.
  4. House fund– Owning a home is a big goal!  While we are not ready to buy a home quite yet, it’s something we want to continue to save for.
  5. Travel fund– Hands down my favorite savings account.  It’s always nice to have the extra cash on hand to buy plane tickets and other travel essentials.
  6. Retirement– I have both a Roth and a Traditional IRA.
  7. Investments– I like to call these my “build wealth” funds. These are mutual funds that I don’t have any big plans for, but continually add money to.

 

I have monthly automatic deposits setup that shuttles money from the checking account into many of these different savings/investment accounts listed above.  I view these automatic deposits as BILLS.  There is no way you wouldn’t pay your rent or mortgage, right?  Well, that’s how I recommend you view your savings if you really want to make some big progress.  There are no excuses!

 

I stared 2018 by listing out what dollar amounts I wanted these various accounts to be by the end of the year.  For each account, I took that goal amount and subtracted the current balance, then divided that amount by 12 months.  That is the monthly contribution.

 

Ever since I started freelancing, I’ve become more conservative with my money. Before I set off for this lifestyle change, I stopped a few of the automatic deposits that I had coming out of my checking account every month just to be safe.  I wanted to set BIG goals for myself, but also be realistic. As time went on I slowly started up again and even increased a few of the contribution amounts.  It feels good to back in full swing!

 

What accounts do you use? How are they helping you reach your money goals? Comment below =)

 

“Money does not dictate your lifestyle, it’s what you do to get it and how you manage your finances that determines your lifestyle.” – Wayne Chirisa

 

Thanks for Reading,